Bahamas gains support of Permanent Court of Arbitration

A representative from the world’s oldest international dispute resolution body claims that there is significant demand for arbitration arising from the region, which The Bahamas has the potential to assist in resolving by becoming a host country for the Permanent Court of arbitration in the Hague (PCA).

At a conference on Friday, legal counsel with the Permanent Court of Arbitration in the Hague, Kathleen Claussen, explained that with 11 percent of the 90 pending cases at the court arising out of the Caribbean region, and a total of 50 percent of their pending cases coming from the North and South Americas as a whole, The Bahamas could form a strategic location for these matters to be heard that would allow for hearings without participants having to travel to the Hague in The Netherlands.

Claussen spoke as a guest panelist at the Pre-ICCA (International Council of Commercial Arbitration) conference held at the British Colonial Hilton on Friday, along with Lawrence Teh, partner with Singaporean law firm Rodyk and Davidson; Justice Jacob Wit of the Caribbean Court of Justice; arbitrator and partner with Hamilton Abogados, Madrid, Calvin Hamilton; Attorney General Allyson Maynard-Gibson and Minister of State for Legal Affairs Damian Gomez.

Investigating and discussing the potential of The Bahamas as a center for arbitration “complimenting the Americas”, the conference was organized by the Bahamas Chapter of Chartered International Arbitrators (CIarb), in conjunction with the Ministry of Financial Services, and brought over to Nassau top practitioners and stakeholders who were in the area to be involved in the ICCA Conference that began in Miami, Florida, yesterday.

Claussen proposed several key steps The Bahamas can take towards establishing itself as a seat for arbitration globally, suggesting there is significant potential for the country to see this type of business come to its shores.

She encouraged The Bahamas to become a member state of the PCA as a “first, easy” step towards developing as a center for arbitration, following this with putting in place a “host country agreement” with the PCA that would allow the PCA to “easily bring in arbitrators” to The Bahamas, bringing arbitrations to this country without having to establish a “center or court.”

While the PCA has other members in this region, including the Dominican Republic, Haiti and Cuba, Guyana and Suriname and Central American countries, The Bahamas would have “clear” advantages over them given its English language, expressed commitment to developing as an arbitration center, convenience for travel and other factors, suggested the PCA legal counsel.

“Benefits of (a host country agreement) include attracting arbitrators to the region, raising the profile of The Bahamas as an arbitral forum and then promoting domestic arbitration as well,” said Claussen.

A further step would be the establishment of a physical arbitration center in The Bahamas.

“That would allow us to designate arbitrators through the center here…We have worked with 22 different arbitrations involving Caribbean parties in recent years. We have had 56 requests for arbitrators involving companies or countries in this region. Those are clear cases where we can call upon a Caribbean arbitration center based in The Bahamas to say ‘Who would you suggest in this case? Who’s someone we can call upon based in this region?’. The cooperation just goes from there,” said Claussen.

From this point, the PCA could consider having a permanent staff presence in The Bahamas, such as it does in Mauritius, to work on building an arbitration center there.

The “four Ps” – patience, working with key press outlets, having a presence at major arbitral forums like the ICCA conference currently underway in Miami, and patience, are critical, said Claussen.

“Singapore in 2003 the international arbitration center had 64 disputes, 10 years later they had 259. In Dubai in 2008 they had 77 cases at their international arbitration center, three years later they had 470. So it takes time. If you build it they won’t necessarily come unless you do other things,” she said.

Attorney General Allyson Maynard Gibson pledged the government’s support towards having The Bahamas established as a center for arbitration. However, she noted that such an effort will only be successful with the “buy in” of the Bahamas Bar Association and the judiciary. “If they don’t buy in, we’ll have a terrible problem,” she said.

Attracting arbitration to The Bahamas has the potential to “increase quality of life”, said the Attorney General, bringing business to the country that will increase demand not only for staff related to the arbitration but also hotels, restaurants and more.

She said that it will be important for “flexibility” in work permit policy to help facilitate the development of the sector along with the spin-off benefits it can bring, a point backed by other panelists based on their experience elsewhere, such as Teh in Singapore.

Other panelists, such as Justice Wit, emphasized how modern equipment, processes and technology, must be in place to facilitate efficiency in the arbitration process.

Minister of State for legal affairs, Damian Gomez, admitted that there are challenges at present in the court system that exists in reaching decisions speedily, and this “does more to harm the jurisdiction’s reputation than anything else.”

He said that efforts have been made to streamline the processes in civil litigation with a view to addressing this stumbling block, but it has taken “an awfully long time” for results to be produced.

Particularly given these backlogs in the judicial system, he backed the position of many others at the conference that non-interference by judges of the court in arbitral matters would be key.

“We need that so that as a jurisdiction international consumers can look to us with the expectation that they are able to get judicial services of the highest caliber within the most efficient period of time,” said Gomez.

Justice Abdulai Conteh of the Court of Appeal congratulated and supported the conference, but insisted that more work must be done to “sensitize” the judiciary on the arbitration process and to “get them to engage and support the process.”